As much as we may want to pretend otherwise, the business world isn’t an even playing field. No matter how good an idea or business plan you have, there can still often be a complex mix of social and financial barriers to getting a loan. And, of course, having bad credit never makes getting a loan easy.

There are, however, ways to circumnavigate racial lending biases and disparities, sometimes even when your credit is shot. We’ll explore some strategies and options below.

The Small Business Administration (SBA)

The federal SBA doesn’t lend directly, but its lending programs specialize in providing guarantees for businesses that might otherwise be turned away by traditional lending institutions—the SBA actually offers to pay back a percentage of the loan should you default. You’ll still need to meet the SBA’s own program criteria, however, which can sometimes include training, classes, and disclosing business plans.

There are a couple SBA programs that can be particularly useful for minority-owned businesses:

Minority Business Development Agency

Another government agency you can take advantage of is the Minority Business Development Agency. In addition to the online resources they offer, they maintain business centers in most major cities.

Among the services they offer is helping minority-owned businesses connect with lenders.

Minority Depository Institutions (MDIs) and Community Development Banks

MDI is a designation that can be claimed by institutions at which 51 percent of the stock is held by minorities and which primarily serve communities that are predominantly “Black American, Asian American, Hispanic American, or Native American.” Many of these institutions will be familiar with the challenges of starting businesses in their communities and be able to offer guidance about how best to proceed.

Your options will be a bit constrained by geography, but most major and secondary cities will have at least MDI.

Alternative Lenders

Since the tightening of traditional credit markets after the Great Recession, a large, primarily online, lending industry has stepped in to fill the void.

At a glance, alternative lenders run the gamut between conservative and high-risk. Overall, their loans are easier to qualify for. Many will lend to owners with poor credit; some won’t even do a hard pull on your credit score.

That being said, be extremely cautious dealing with alternative lenders. Many offer reasonable if somewhat unorthodox deals. Others charge usurious interest rates that can sink an unprepared business and compound your existing problems.

Here are a few options to consider if traditional loans are eluding you:

Final Thoughts

As large as the challenges facing minority business-owners can be, remember that there are a number of sympathetic agencies, organizations, and even lenders that exist to help correct lending disparities. Do your research before taking any loan offer, and be sure to also check out our more general resources on how to get your business off the ground when you have bad credit.